SHAFAQNA (Shia International News Association)- A high-ranking Indonesian energy official says Iran is planning to supply crude oil to the Southeast Asian country and construct a number of oil refineries there.

Acting director general for oil and gas at Indonesian Energy and Mines Ministry, Naryanto Wagimin, told reporters in Jakarta on Thursday that the refineries, which are estimated to cost USD 3 billion, are planned to be built in Indonesia’s western provinces of Banten and West Java.

“It’s still at the initial stage. We will need a further meeting to discuss the realization of their plan. We welcome them. We will have a working group meeting to follow this up,” he said.

Naryanto further noted that Indonesia has found Iran’s crude oil suitable for processing at Cilacap refinery in the southwestern part of Central Java Province.

“Thus, it [Iran] plans to build a refinery that will be supplied by its crude oil,” he added.

On the same day, Iran’s Nakhle Barani Pardis and Indonesian PT Kreasindo sealed an agreement for the construction of oil refineries in Indonesia.

Kreasindo’s director, Rudy Radjab, said the Iranian oil firm has pledged to supply between 20,000 and 300,000 barrels per day (bpd) of crude oil to the refineries over a 20-year period.

Nakhle Barani Pardis has reportedly accepted to finance 30 percent of the refineries, while Kreasindo will fund the remaining 70 percent.

In recent years, Indonesia has seen its crude oil consumption grow and reach around 1.6 million bpd, while its national output stands below 800,000 bpd.